Faq Corporate Governance Compliance
India-specific preparation guide
Faq Corporate Governance Compliance needs current-law checks, portal verification, documents and a precise brief before you compare experts on the WorkIndex work index.
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Faq Corporate Governance Compliance is best handled after identifying the exact scope, period, applicable portal and documents. Use this page to prepare a sharper expert brief instead of relying on generic summaries.
- Identify the exact period, assessment year or tax year, income head, entity type and portal status before applying Faq Corporate Governance Compliance.
- Reconcile source data such as AIS/TIS, Form 26AS, books, bank statements, invoices, notices and prior returns.
- Ask the expert to flag regime choice, deduction limits, disclosure schedules, penalty exposure and expected deliverables.
- Do not rely on old blog summaries where forms, deadlines, sections or portal utilities have changed.
Accuracy notes before you act
- Secretarial audit is mandatory under Section 204 of the Companies Act, 2013 for listed companies, public companies with paid-up capital >= ₹50 crore or turnover >= ₹250 crore, or any company with outstanding bank/PFI loans >= ₹100 crore.
- Under SEBI LODR Regulation 24A, all listed entities and their material unlisted Indian subsidiaries (net worth/income >10% of consolidated) must undergo secretarial audit.
- Effective from FY ending March 31, 2025 (SEBI LODR Third Amendment Regulations, 2024), listed entities must appoint specifically a Peer Reviewed Company Secretary in Practice (PCS).
- ROC Chennai Adjudication Order (Jan 7, 2026) imposed a ₹2,00,000 penalty per director for failure to file Form MR-3. Section 204 penalty is a flat ₹2,00,000 on the company, officers, and PCS.
Documents and facts to keep ready
- PAN, Aadhaar, GSTIN, CIN/LLPIN, TAN or registration details where applicable.
- Relevant financial year, assessment year, tax year, return period, due date and notice number.
- Books, invoices, payroll, bank statements, contracts, prior filings and portal screenshots.
- Expected output: filing, registration, correction, advisory memo, notice response, audit report or recurring compliance.
Common mistakes to avoid
- Using an old due date, old section number or old form without checking the live portal.
- Posting a vague requirement without period, entity type, city, documents and deadline.
- Comparing quotes without clarifying government fee, professional fee and exclusions.
- Skipping reconciliation with AIS/TIS, books, Form 26AS, GST data or bank records.
- Treating explanatory SEO content as final tax, legal, audit or investment advice.
Frequently Asked Questions
1. What is a Secretarial Audit, and who is authorized to conduct it?
A Secretarial Audit is an independent compliance audit of a company's records to ensure compliance with corporate, securities, and other applicable laws. Under Section 204 of the Companies Act, 2013, only a practicing Company Secretary (PCS) can conduct this audit and sign the report in Form MR-3. Chartered Accountants (CAs) are not authorized.
2. What are the applicability thresholds for Secretarial Audit under Section 204?
Secretarial Audit is mandatory for: (1) Every listed company, (2) Every public company with paid-up share capital of ₹50 crore or more, (3) Every public company with a turnover of ₹250 crore or more, or (4) Any company (including private companies) with outstanding bank or public financial institution loans/facilities of ₹100 crore or more.
3. How does SEBI LODR Regulation 24A expand Secretarial Audit requirements?
Under SEBI LODR Regulation 24A, every listed entity and all its material unlisted Indian subsidiaries must undergo a Secretarial Audit. A subsidiary is considered 'material' if its income or net worth exceeds 10% of the consolidated income or net worth of the listed entity in the preceding financial year.
4. What is the new Peer Reviewed CS requirement for listed companies?
Effective from FY ending March 31, 2025 (SEBI LODR Third Amendment Regulations, 2024), listed entities must appoint a Company Secretary in Practice who holds a valid Peer Review Certificate issued by the ICSI Peer Review Board to conduct the Secretarial Audit.
5. What is Form MR-3, and what does it report for Corporate Governance Compliance?
Form MR-3 is the official format for the Secretarial Audit Report. The PCS must report compliance with the Companies Act, SEBI Act, Depositories Act, FEMA (for FDI/ECB/ODI), and various industry-specific laws, along with the Secretarial Standards (SS-1 and SS-2). It does not certify financial records, which is the statutory auditor's role.
6. What is the penalty for non-compliance under Section 204?
If a company, any officer in default, or the practicing company secretary violates Section 204, they are liable to a flat penalty of ₹2,00,000.
7. Can a private company fall under the mandatory Secretarial Audit threshold?
Yes. While the capital and turnover thresholds apply only to public companies, the loan threshold of ₹100 crore or more applies to *any* company. Therefore, private companies with outstanding bank/PFI loans exceeding ₹100 crore must undergo a Secretarial Audit.
8. How are outstanding loans calculated for Secretarial Audit applicability?
The outstanding loan limit of ₹100 crore or more is checked as of the latest audited financial statement date, but compliance must be monitored throughout the year. It includes term loans, working capital facilities, and other credit lines from banks and public financial institutions (PFIs).
9. What is the significance of the ROC Chennai Adjudication Order of January 7, 2026?
In Order PO/ADJ/12-2025/CN/01197, the ROC Chennai penalized a company and its directors ex-parte under the Companies (Adjudication of Penalties) Rules, 2014, imposing a penalty of ₹2,00,000 per director from their personal funds for failing to file Form MR-3 for three consecutive years.
10. Is filing Form MGT-14 mandatory for appointing a Secretarial Auditor?
Yes. Under Section 179(3) read with Rule 8 of the Companies (Meetings of Board and its Powers) Rules, 2014, the appointment of a Secretarial Auditor must be approved via a board resolution, and the company must file Form MGT-14 with the ROC within 30 days of the resolution.
11. What is the difference between a Secretarial Audit and a Statutory Audit?
A Statutory Audit focuses on the financial statements and books of accounts to verify they present a true and fair view (conducted by a CA). A Secretarial Audit focuses on compliance with corporate and statutory laws, board procedures, and secretarial standards (conducted by a CS).
12. What are Secretarial Standards SS-1 and SS-2?
SS-1 (Secretarial Standard on Meetings of the Board of Directors) and SS-2 (Secretarial Standard on General Meetings) are standards formulated by the ICSI and approved by the Central Government. Compliance with these standards is mandatory for all companies (except OPCs and certain private companies) under Section 118(10).
13. What is the timeline for submitting the Secretarial Audit Report?
The Secretarial Audit Report (Form MR-3) must be annexed to the Board's Report (under Section 134(3)), which is sent to shareholders before the Annual General Meeting (AGM) and filed with ROC in Form AOC-4.
14. What are the duties of directors regarding a Secretarial Audit?
Directors must provide all assistance, records, books, papers, and facilities to the PCS to conduct the audit. Additionally, the Board must explain in full any qualification, reservation, or adverse remark made by the Secretarial Auditor in their report.
15. Does a debt-listed company need to comply with SEBI Regulation 24A?
Yes. SEBI LODR regulations apply to any listed entity, whether equity shares or debt securities are listed. A company with only listed NCDs or debt securities must undergo a Secretarial Audit under SEBI LODR, even if it does not meet Section 204 thresholds.